SUMMARY
The Times Internet honcho was working at Lehman Brothers when the financial collapse of the investment bank that led to the Great Recession happened, and he landed up at the media conglomerate
Gajwani has shaped the conglomerate’s internet business strategy through a flywheel of data and subscription that drives user growth and higher ARPU for its products spanning more than 10 verticals
The media behemoth’s internet products, including its flagship news platforms, reach over 550 million users every month and is the largest digital platform in India outside of Google and Facebook
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How do you end two days of intense brainstorming on products by a stellar list of speakers such as Zoho founder Sridhar Vembu, OYO founder Ritesh Agarwal and Zerodha founder Nithin Kamath?
It would seem our decision to invite Times Internet chief Satyan Gajwani paid off handsomely as he talked about how he built an ecosystem of tech products and startups on the palimpsest of a rich legacy of 182 years.
Moderating the session, Inc42 cofounder and CEO Vaibhav Vardhan set the ball rolling by asking Gajwani what brought a Stanford engineering degree to the world of Indian media.
The Times Internet honcho was working at Lehman Brothers at the time of the investment bank’s financial collapse, leading to a global economic recession. It was at this point that Gajwani landed up at The Times Of India and started by immersing himself into understanding the workings of the media giant.
But the conglomerate’s mainstays of print and television media didn’t interest him — he was more keen to be at the steering wheel of Times’ foray into the digital era.
“The only place that really felt natural to me was the digital space. My friends and the people I grew up with in college were running many of the big tech companies in America,” recalled Gajwani.
That interest today has taken the shape of an internet empire with three dozen tech properties, including on-demand streaming services such as streaming services MX Player and Gaana, food tech platform Dineout, lifestyle company MensXP, logistics startup Delhivery, real estate aggregation platform Magicbricks, among others. The conglomerate’s internet products, including its flagship news platforms, reach over 550 million users every month and is the largest digital platform in India outside of Google and Facebook.
Putting Together A Panoply Of Digital Products
The thrust of Times Internet’s strategy to reach this scale has been on leveraging users across segments by layering products in more than 10 verticals. According to a slide in Times Internet Annual Report 2020, personal finance, real estate, food, jobs, and education products are higher drivers of ARPU (average revenue per user) and the news and streaming platforms act as cost-effective customer acquisition funnels.
These two parts are connected by underlying pipelines of data, subscriptions and loyalty programmes, helping piece together a vast array of services. But building this universe of connected digital products wasn’t easy when Gajwani took the reins at Times Internet.
He put together a three-pronged approach to investments and product building to create a digital canvas — the first was pure play acquisitions such as Cricbuzz and MensXP where the startups were allowed to chart their own course and bring more users and revenues to the Times universe.
Another strategy was to make strategic investments in internet companies such as Delhivery, Uber, Smule, among others, whose partnerships might turn out to be useful one hand while ensuring higher returns on investment too.
But the most interesting one though was creating products ground-up such as Gaana or rebuilding a product entirely after the acquisition as in the case of MX Player and Dineout.
“We built Gaana from zero around 10 years ago. And really built it up in-house, first as a web product and then mobile”, said Gajwani. In contrast, MX Player was redesigned from an app that played back videos stored in a phone to a video streaming product.
While Gaana taught Times Internet how to build and scale a digital product from scratch, its learnings from MX Player have been wider. Just after the acquisition of the video player, the media company was looking to rebrand it for launching a streaming service with original content.
“We were sceptical that if we just go out there and make a bunch of shows and put them on an app, it would actually work. This is because our DNA isn’t really necessarily on content, it’s on product and technology. And one of the things we’ve learned is that growth is really hard,” Gajwani added.
As an experiment, Times decided to rename the app as ‘MX Play’ on the Google Play Store as a part of the rebranding exercise. This led to downloads dropping by 20% on the first day and the plan had to be reset.
”We realised at that point that as we build for larger audiences, we need to understand how small things can affect them. I think we discounted the degree to which, despite the fact that there was no marketing, the brand was so powerful,” Gajwani told Vardhan.
Building A Lite Super App Ecosystem
These kinds of iterative learnings are what has forged Gajwani’s vision of what a super app ecosystem should look like. While WeChat in China has been successful in building an ecosystem that offers everything from payments to delivery, GoJek and Grab are cloning the model to varying degrees of success in Southeast Asia.
However, India is yet to see such one company offering a vast array of digital products under a single umbrella and succeeding, though Paytm, Ola and Flipkart are trying to create a network of different services.
Gajwani believes that tech companies trying to build extra products and features just with the intention of creating multiple funnels for user growth and revenues will not work. He learned this lesson the hard way with the acquisition of Haptik, a chatbot company that was ultimately sold to Reliance Jio in 2019.
The plan initially was to embed a chatbot across the entire ecosystem of products and make it easy for users to avail one of the services when they were on any of the platforms — for instance, book a movie ticket while reading a review on one of the news sites.
“We learned that creating super apps is not as simple as just putting stuff in front of customers. The truth is that when a user is reading the news on Times of India, they aren’t looking to book a movie ticket,” said Gajwani.
But that doesn’t mean he dropped the plan entirely — instead the concept of a super app ecosystem is being slowly adapted in part by embedding Gaana and a games section in MX Player. The idea was to build tangential use cases for the consumer on a single platform rather than going all out to offer a sprawling array of products on a single screen.
“If our first effort had been to tell users ‘Come take a loan from MX Player’, we think it would have flopped because going from playing videos to financial services is such a disparate random gap that we felt like it was never going to happen,” said Gajwani.
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Cracking The Subscription Puzzle By Bundling Services
Though a vast array of products haven’t been integrated into a single super app, Times Internet has found another way to bundle multiple services through the Times Prime subscription model.
It offers a user more than 15 services — including products from the Times universe and also from its peers — at a price point of INR 999.
Under a single umbrella, a consumer can now access premium subscriptions to the news on Times of India and ET Prime, fashion, and lifestyle services through Myntra, MensXP, Dineout and Cure.fit, streaming on Mubi, Audible and Zee5, among others.
Gajwani believes that in a price-sensitive market like India, where largely users haven’t developed the propensity to pay yet for digital products, only a few subscription-led businesses would be able to break out and scale.
According to him, the key to driving subscription growth would be to create enough value for a huge mass of users and being agnostic to what individual consumers prefer within the bundle. “It’s a very weird idea to say ‘Pay for Times of India to access premium news, and also buy one, get one free at the best restaurants in your city’”, Gajwani quipped referring to the Dineout service in the bundle.
But the strategy has worked — Prime has helped grow the subscriber count of the Times Internet array of products to 2 Million — and there has been a 48% increase in users consuming 2 or more of its properties each month, and a 120% rise in users consuming 3 or more of its properties each month in the last year.
“Our ability to reinvest some of that money into making the subscription product better, not only gives better value to those 2 million users, but attracts the next 2 million users,” said Gajwani.
Reading Data The Right Way
When you touch more than 550 Mn users on the internet every month, there would be a tremendous amount of data generated. While this pool of data is an important part of the flywheel that drives cross-pollination of users from one product to another there’s also the problem of having enough numbers to be able to create any business narrative according to one’s wish.
“With so much data on the fingertips, you can make any business look good. On paper, you can say I’m the largest XYZ and make up a category that nobody cares about. You can start quoting certain vanity metrics that make you feel good because they show things that you want,” according to Gajwani.
Moreover, for a media company the size of Times, it would be easy to give in to bias and conflate data points such as social media click-throughs and pageviews as a user engagement metric.
“I made a really big shift to say that I don’t care about monthly users. I care about daily users and time spent. Because those are more honest reflections on how much people care about your products,” said Gajwani.
Giving Product Teams The Freedom To Experiment
Apart from data, there was another problem that Gajwani identified on taking over the digital business — steeped in 186 years of legacy, the group didn’t have a lot of fresh ideas and people with an entrepreneurial instinct to break free of the traditional systems.
While a string of product acquisitions and product innovations have followed in the last decade to rectify this anomaly, the most important departure has been to create a direct channel of communication between entrepreneurs, product teams in the Times fold with the top brass at Times Internet.
Gajwani said that he also made sure that the group wasn’t interfering with the functioning and decisions of startups they acquired. For instance, the founders of Cricbuzz sought an exit after two years while inking the acquisition deal thinking that there would be a lot of roadblocks and speed breakers once they had to report to bosses at the media conglomerate. But they have stayed on even after six years — a fact that Gajwani credits to the hands-off approach that he adopted in dealing with startups that already have a proven business model.
Perhaps staying close to the heart of the tech world in his San Francisco home has had to do with the realisation that older folks don’t necessarily have better insights of what consumers want because of their experience. “There are people who are a few years out of college and a deep intuitive understanding of how products work compared to someone who has 15 years of experience,” said Gajwani.
But he returns to the importance of measuring what matters, saying that people with the best intuition are the ones who are very clear on how to differentiate signals from noise — a product team has to recognise that out of seven experiments, five are going to fail — and zero in on the ones that are going to make a meaningful change.
“The best product managers are the ones who are really salient about understanding what’s going to move the needle for them. And then they’re methodical about testing,” he said.
This article is part of our coverage around The Product Summit 2020 by Inc42, which took place on October 10 & October 11. TPS 2020 was supported by Amplitude, AWS, Dell Technologies, and DigitalOcean.
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